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Economic evaluation overview
An economic evaluation is used to determine how to allocate resources within or across programmes to maximize value for investment.1 For this reason, economic evaluations are sometimes called value for money evaluations.
Economic evaluations can be used to:2,3
- Compare costs and benefits of a programme or across programmes
- Determine opportunities to produce the same value for less money
- Express the value of social or health outcomes in monetary terms
- Inform decision making about programmes by adding a different perspective
Conducting an economic evaluation
There are five types of economic evaluations:4
- Cost-benefit analyses measure the costs and benefits of a programme to determine if the benefits outweigh the costs and compare it to other, similar programmes.
- Cost-utility analyses measure the impact of the programme using a single measure, such as quality-adjusted or disability-adjusted life-years, relative to cost.
- Cost-effectiveness analyses measure the cost of producing a benefit on a per unit of measure, such as cost per participant served.
- Cost-minimization analyses compare the costs of two similar programmes to determine which one is less expensive.
- Cost-consequence analyses assess a wide range of costs and consequences (effects) of products and compares and reports them separately.
Note: When developing an economic evaluation, it is critical to consult with an economist to ensure the validity of the methodology and the suitability of the evaluation questions.
Additional resources
For more information on economic evaluations, visit the resources below or reach out to us at evaluation@greo.ca to see how we can help
- Guidance on economic evaluation (Public Health England)
- Five-part webcast on economic evaluation (Centers for Disease Control and Prevention)
- Guide to the fundamentals of economic evaluation in public health (MEASURE Evaluation)
- Public Health Economics: A systematic review of guidance for the economic evaluation of public health interventions and discussion of key methodological issues (BMC Public Health journal article)
- Methods for assessing costs of gambling related harms and cost-effectiveness of interventions (London School of Economics and Political Science)
1 Public Health England (2018) Guidance: Economic evaluations. https://www.gov.uk/government/publications/evaluation-in-health-and-well-being-overview/economic-evaluation
2 Centers for Disease Control and Prevention’s Division for Heart Disease and Stroke Prevention. Program evaluation tip sheet: Economic evaluations.https://www.cdc.gov/dhdsp/docs/program_evaluation_tip_sheet_economic_evaluation.pdf
3 Centers for Disease Control and Prevention’s Division for Heart Disease and Stroke Prevention (2017). Five-part webcast on economic evaluation. https://www.cdc.gov/dhdsp/evaluation_resources/economic_evaluation/index.htm
4 Palmer, S., Byford, S., & Raftery, J. (1999). Economics notes: Types of economic evaluation. BMJ (Clinical research ed.), 318(7194), 1349. https://doi.org/10.1136/bmj.318.7194.1349